Asian Stocks Fall as Warsh Hints at Rate Hikes Amid Iran Conflict

Asian stocks fell on Monday as hawkish comments from Federal Reserve boss Kevin Warsh boosted bets on a US interest rate hike.

The war between the US and Iran has pushed oil prices higher, with crude up by over two percent after a fresh flare-up in hostilities.

Warsh's speech at the Jackson Hole symposium of central bankers and economists in Wyoming left traders with few doubts that he was ready to increase borrowing costs. He described the spike in inflation as 'concerning' and said he would be 'hard-pressed' to describe current financial conditions as 'restrictive', hinting at rate hikes.

The Fed's battle against inflation has been hobbled by the Iran war, which has driven up energy costs and pushed inflation above its two percent target. Oil prices have spiked after a US attack on Iranian rocket launchers, prompting Tehran to retaliate with strikes on US military targets in Jordan.